Early economic challenges/Stresemanns reforms Flashcards
Why was the Ruhr so significant to Germany?
80% of German iron, coal and steel resources. Highly industrial, contained many factories, as well as being on the border (high value).
How did Germany end the French invasion of the Ruhr?
1923: French invade due to failed payment of reparations
Passive resistance urged by government through strike (due to limited army from the ToV). Germans resentful of french, leading to increased violence.
What was the effect of hyperinflation on Germany?
Started due to high amounts of money being printed to pay striking workers in the Ruhr. Marks became worthless as amount increased, therefore value decreased. Bread 200,000 million marks in November 1923. Food shortages caused, as foreign suppliers wouldn’t accept worthless German mark. Workers had to be paid 2x a day.
What was the ‘Rentenmark’?
Temporary currency created to end hyperinflation. Able to be exchanged for old currency in limited amounts, stopped old money being printed.
How did Stresemann solve the German industry problem?
Used money lent by US to build new houses, factories, roads, therefore creating more jobs. American companies built factories in Germany.
What was the ‘Dawes plan’?
Introduced by Stresemann in 1924, when he met with American vice president Charles Dawes. Lent Germany 800M marks to restart reperations/what was owed following invasion of the Ruhr.
What was the ‘young plan’?
Made in 1929 by Stresemann. Reduced reperations to £1.8B, however led to tension as some Germans felt the reperations should have been ended altogether.
What is an example of Germany regaining prosperity under Stresemann?
Sales of radios increase largely
1m in 1927 -> 4m in 1932
How did stresemann’ economic changes limit Germany?
Germany became extremely reliant on America economically. Crisis inevitable when money would be wanted back (Wall street crash/Great Depression).
What was the ‘Locarno Pact’?
1925: between Britian, France, Italy and Belgium.
Rhineland permanently demilitarised. Germany accepted its 1919 ToV borders with France. Not imposed on Germany - treated as an equal. Germany joining League of Nations discussed.
What is the League of Nations?
1926: Stresemann persuaded powers to let Germany join League of Nations (group of nations who meet to discuss foreign policy issues). Boosted confidence in Weimar Republic ‘s rule, made it easy for Germany to negotiate. Some opposed this as they believed it was representative of the ToV.
What is the Kellogg-Briand pact?
1928: made by French + American foreign ministers, signed by Germany and 61 other countries. Promised states would not go to war to achieve foreign policy aims. Didn’t take away ToV terms.
What was the impact politically of Streseman’s foreign and economic reforms?
Increased confidence in moderate parties, only 6 coalition governments between 1924-29. Weimar seen as a respected, stable state. Treaty of Versailles terms still in place.
The wall street crash
October 1929: US stocks crash: leading to global economic depression
Germany effected most as US recall loans given through Dawes Plan 1924 (800M marks)
German industry loses finance, lowers production, lays off workers.
People spend less, prices drop, demand fails
-> large increase in unemployment
What was the impact of unemployment due to Great Depression?
Unemployment rose from 1.4m to 2m
By 1933, 1/3 people unemployed
Industrial production halved
Significantly raised government expenditure, loss of faith in democracy.
